By Greg Bishop/Illinois Radio Network
SPRINGFIELD – Gov. Bruce Rauner is hopeful bond purchasers can look past the state’s dire finances and still line up to loan the state more money.
Illinois plans to sell $550 million in bonds on June 16.
Gov. Bruce Rauner said that, despite Illinois’ past fiscal mismanagement, his proposed reforms give investors confidence. “They’re supportive of what we’re trying to do in our administration,” the Winnetka Republican told reporters at an Illinois Chamber of Commerce luncheon. “The reforms that we’re advocating are supported by investors and they believe in our administration and the potential future for Illinois.”
State Treasurer Michael Frerichs said he expects the bond sale to go through because investors will be paid before anyone else. But he said Illinois’ poor credit will mean higher interest rates. “When we go out and issue bonds with a lower credit rating, we are going to ultimately pay more for that. That’s also going to be money that comes out of the pockets of the taxpayers of Illinois.”
The bonds up for sale will be spent on infrastructure projects like road construction.
Illinois was downgraded by two credit ratings firms largely due to the state’s failure to adopt a budget and pay down pension costs. Moody’s Investors Service places Illinois’ general obligation bonds two levels above junk bond, or non-investment grade, status.
